Assignment
1. Based on the information in the three files, define and describe how to interpret each of the following financial indicators:
• Profitability Ratios:
o Operating margin (AKA Profit margin)
o Return on equity (ROE)
• Net Revenue Ratios:
o Contractual Allowances Percentage
o Charity Care Percentage
• Asset Management Ratios :
o Days cash on hand
o Total asset turnover
o Current asset turnover
• Liability and Liquidity Ratios
o Current ratio
o Debt-to-equity
2. Is Cavalier Hospital financially healthy or sick? - Summarize each of the following financial indicators for Cavalier in relation to changes or trends over time and in comparison, to "comparable" healthcare organizations.
• Profitability Ratios:
o Operating margin (AKA Profit margin)
o Return on equity (ROE)
• Net Revenue Ratios:
o Contractual Allowances Percentage
o Charity Care Percentage
• Asset Management Ratios :
o Days cash on hand
o Total asset turnover
o Current asset turnover
• Liability and Liquidity Ratios
o Current ratio
o Debt-to-equity
3. Do you have any concerns regarding the following? Why/why not?
• Contractual allowances
• The Rotunda center
• The expansion of Hamilton hospital
4. How has Cavalier's position changed financially after the opening of the Rotunda Cardiovascular Center?
5. What is Harrison's rationale for seeking capitated payments? Do you foresee any perverse incentives by having some of the patients on a capitation reimbursement structure and others on a fee-for-service model?
6. Should Harrison advocate an expansion of the Rotunda model across all specialties in the hospital? If so, what financial trends should he seek to continue or reverse in implementing the new model?
Article: Business Perpormance Evaluation: Approaches for Thoughtful Forecasting.
Text book: Public Health- Leadership & Management Case and Context by Stuart A. Capper, Peter M. Ginter and Linda E. Swayne.
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.